Request for Payment of VAT Liability in 8 Quarterly Installments, Inclusive of Interest Without Surcharge

June 15, 1998 BIR RULING NO. 092-98 248 (A) (1) 249 (A)-092-98 Transpacific Towage, Inc. Transpacific Building 2444-A Taft Avenue Attention: Mr . Geronimo P . Bella Jr . President Gentlemen : This refers to your letters dated February 16 and 23, 1998 requesting that you be allowed to pay your VAT liability amounting to P2,400,115.96 in eight (8) quarterly installments, inclusive of interest without surcharge, commencing on May 31, 1998 up to February 28, 2000. LLjur It is represented that you have imported a tugboat (Choctaw-ex. Name: Gekko Maru) which is presently berthed at the Manila International Container Terminal; that the said vessel has been at berth since her arrival on December 21, 1997 with a daily expense of almost P15,000 excluding the cost of importation and opportunity loss; that you are currently encountering financial constraint and difficulties due to the decrease in the arrival of foreign ships; that you are willing to file a surety bond as a guarantee for the faithful performance of your tax obligation. You further alleged that you are presently burdened with overhead plus increased banking charges on your financial obligations which is currently running at 29.30% per annum; and that with the imposition of 25%, you will be paying almost 55% in interest and other fees against the principal amount, viz: (inclusive of surcharge and interest) shall be paid within six (6) months from date of release of such vessel, computation of which is as follows: Basic tax due P2,400,115.96 Less: Downpayment 500,000.00 Balance VAT Liability P 1,900,115.96 Surcharge (25%) P 475,028.97 Interest (10% of P1,900,115.96 computed for a period of 6 mos. from date of release of vessel based on 20% interest per annum) 190,011.59 Total Balance to be paid on the second and final installment payment on or before 6 mos. P2,565,156.52 ============ However, we are requiring you to submit a surety bond to the Chief, General Services Division, 8th Floor, National Office Building at twice the amount of the balance due of P2,565,156.52 to guarantee the payment of your remaining VAT liability (inclusive of surcharge and interest). cdll Very truly yours, (SGD.) LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue